. Railroads, rates and regulation . w York, the influence ofthe roundabout carriers by sea progressively diminished; until,at last, beyond the Missouri it became nil. Such water com-petition affording the only pretext for a grant of lower rates tothe Pacific terminals than to intermountain points, it followed,logically, that the disparity in charges between such interior andcoastal places should decrease pari passu with the westwardmovement of the originating point. A substantially lower ratefrom New York to San Francisco than from New York toNevada might be permitted; but no such difference,
. Railroads, rates and regulation . w York, the influence ofthe roundabout carriers by sea progressively diminished; until,at last, beyond the Missouri it became nil. Such water com-petition affording the only pretext for a grant of lower rates tothe Pacific terminals than to intermountain points, it followed,logically, that the disparity in charges between such interior andcoastal places should decrease pari passu with the westwardmovement of the originating point. A substantially lower ratefrom New York to San Francisco than from New York toNevada might be permitted; but no such difference, relatively,ought to obtain from St. Paul or Omaha to San Francisco ascompared with Rocky mountain territory. For these inland1 Chap. X, supra, especially the map facing p. 365. 618 RAILROADS initial points were practically beyond the range of steamshiprivalry. Specifically, the Commission in these orders forbade anyhigher charge to the mountain points from any part of zone Ithan applied to the Pacific terminals. From zone II, lying. four hundred miles more to the east, there would probablynever be any considerable traffic coming back to New Yorkin order to go round by sea, but in rare instances there mightbe some. From this zone, therefore, intermountain rates mightbe not more than seven per cent, above those to the Pacificterminals. And so on as one went east. Rates from zone IIImight be not more than fifteen per cent, higher to Spokane INTERMOUNTAIN RATE CASES 619 than to Seattle. From zone IV to Rocky mountain territorythey might be twenty-five per cent, above those to San Fran-cisco: but the disparity against the intermountain territory,even from here with water competition in full effect, mustnever exceed this percentage. This ingenious plan certainly commends itself in principleto the economic student. It restored in a measure the grada-tions existing in 1887.* It did not create the zones out of wholecloth. It utilized a scheme for division of territory alreadyadopted by
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